“China ultimately aims to dominate Asia, starting with Taiwan. In the worst-case scenario, a Chinese invasion of Taiwan could lead North Korea to launch a war on the Korean Peninsula, escalating into World War III. The Trump administration is using tariffs to prevent that outcome,” said Jason Schenker in a virtual interview with ChosunBiz on May 21.

Schenker, named the world’s top futurist by Bloomberg, heads Prestige Economics and The Futurist Institute. He has written 36 books on economics, finance, and technology, many of them bestsellers.

Provided by Jason Schenker

His latest release “Cold War Two” has quickly gained attention. It topped Amazon’s U.S. macroeconomics chart shortly after publication and is also making waves in South Korea, ranking No. 9 overall on Naver Books and No. 1 in Kyobo Bookstore’s weekly business and economics category as of May 23.

The book declares the dawn of a second Cold War, analyzing its causes, dynamics, and long-term consequences in three parts. Schenker describes this conflict not as a repeat of the U.S.–Soviet rivalry or a struggle between capitalism and communism, but as a global confrontation between China and an anti-China coalition over Asia’s political, military, and economic leadership.

Unlike the past, today’s cold war involves fewer troops and more competition in economics, information, and technology. Control of resources, data, and trade security will be critical, with proxy conflicts and cyberattacks becoming more common.

In his interview with ChosunBiz, Schenker stressed that only countries and companies that successfully rebuild trade networks and secure alternative supply chains will survive the coming shift. Below is the Q&A with Jason Schenker.

In your book, you emphasized the need for the U.S. to enhance economic self-reliance and maintain technological dominance to stay strategically ahead. Do you think the Trump administration has been effective in advancing these goals so far?

“It’s still early in his second term, but the direction is clear. Trump is increasing pressure on China to restore U.S. industrial and technological self-reliance. The tariff and supply chain strategies that started during his first term continued under the Biden administration and are now expanding. With the rising risk of a Taiwan conflict, the U.S. is using not only military deterrence but also economic tools to counter China. Trump is outcome focused, not process focused. Even if alliances are strained, he aims to produce clear deterrent effects. He’s willing to look like a ‘bad guy’ to prevent worst-case outcomes like World War III.”

You also mentioned that the U.S. must strengthen global alliances. Yet the administration imposes tariffs even on allies, which seems to contradict that goal.

“It may seem like the U.S. is straining its alliances, but the real strategy is to push allies to reduce their dependence on China. The Trump administration uses tariffs as leverage to secure real cooperation with allies. For example, threatening tariffs on Canada or Mexico is not about gaining economic benefits but about strongly preventing allies from rerouting Chinese goods, thereby lowering their reliance on China. The U.S. had been asking nicely but didn’t get any progress, so the Trump administration took a heavier-handed approach. Demanding NATO countries increase defense spending and buy weapons is also meant to strengthen their self-defense capabilities. Despite the difficult process, the alliance is being reorganized to reinforce the shared goal of containing China.”

Is the U.S. tariff policy on China effective? It seems like the U.S. has taken a step back in dealing with China. Could this mean the tariff policy is failing?

“I don’t think the U.S. has surrendered or backed off. What this 90-day reprieve has done is create breathing space for deeper dialogue. The U.S. has demonstrated its willingness to apply tariffs at any level without hesitation, showing that the administration is prepared to do whatever it takes to pressure China. And now China has come to the negotiation table, which is what the United States wanted.

The Trump administration’s economic pressure on China is not merely a matter of trade—it serves as a deterrent against a potential Chinese invasion of Taiwan. The U.S. views its tariffs as an ‘economic live fire drill,’ akin to military exercises, designed to demonstrate the extent of pressure Washington can exert to dissuade Beijing from launching an attack. Trump has maintained, ‘War should be avoided, but I will tolerate any level of pressure necessary to prevent it.’”

Which countries stand to benefit most from the U.S.-China trade war?

“India is likely to emerge as the biggest beneficiary. With its large population and low labor costs, it is rapidly becoming a viable low-cost manufacturing alternative to China. In fact, U.S. foreign direct investment is already shifting swiftly from China to India.

However, when it comes to the information and communications technology (ICT) sector, South Korea holds a clear advantage. Major firms like Samsung, SK Hynix, and LG are making large-scale investments in places like Texas, and are now seen as America’s ‘advanced technology partners.’ While Japan may benefit in certain industries, South Korea’s export-driven economy allows it to respond more flexibly to market shifts.

The United Arab Emirates is also worth mentioning. With its geopolitical neutrality and strategic role as a logistics hub, it is positioning itself as an intermediary and drawing global investment attention. But at the heart of Trump’s emphasis on allied blocs lies the U.S.-South Korea-Japan triad.”

Jason Schenker, author of "Cold War Two," during a Google Meet interview with ChosunBiz on May 21. /Screen capture

In your book, you also raise the possibility of war in Taiwan and on the Korean Peninsula. How likely is this, and what form might it take?

“There is real potential for conflict in both regions. A Chinese invasion of Taiwan would likely raise the odds of provocations from North Korea. With the U.S. bound to intervene, Pyongyang may seize the opportunity to act.

2027 is seen as a critical window for a possible Chinese move on Taiwan. China aims to complete its military modernization by then, and the U.S. is already building its contingency plans around that timeline.

South Korea, in contrast, possesses relatively strong deterrence due to U.S. Forces Korea and its own defense capabilities. The country’s standing in the ICT sector also acts as a form of strategic asset. Still, China has stepped up pressure, including increased activity near waters off Jeju Island, so South Korea must remain on alert.”

Despite rising geopolitical tensions, U.S. financial markets remain a top destination for global investment. Will this trend continue in what some call a ‘second Cold War’? Moody’s recently downgraded the U.S. credit rating—does that shake investor confidence in American safe assets?

“Moody’s downgrade isn’t a surprise. Fitch and S&P already acted ahead of them, and those changes have largely been priced into the market. The U.S. remains an attractive investment destination. It is still the world’s largest economy, with a robust consumer base, deep-rooted capital markets, high regulatory reliability, and unmatched military power.

What matters for investors is what they invest in. Buying U.S. stocks versus holding U.S. dollars creates different foreign exchange risks. For instance, if a Korean investor holds U.S. equities and the dollar suddenly drops, their real return diminishes. In such cases, it may be better to invest in U.S. companies via Korean won-denominated ETFs. Currency hedging should be factored into portfolio construction. Still, the U.S. remains the most stable and attractive destination for global capital.”

South Korea’s presidential election is approaching. Candidates are touting plans to tackle the low birthrate and promote AI development. What should the next administration prioritize?

“National security must be the top priority. AI strategy and birthrate policies are important, but if threats from China or North Korea materialize, those plans could quickly become irrelevant.

South Korea already punches above its weight in ICT. Maintaining and expanding that competitiveness while managing security risks should be the core strategy. High-tech capabilities and an export-led industrial base are vital assets for attracting capital and sustaining national branding. But geopolitical risks can undermine that foundation at any moment.

Trump has repeatedly emphasized that South Korea is a critical ally in terms of ‘economic security.’ To maintain that standing, the country must bolster its technological edge while enhancing its diplomatic and military response capabilities.”